Aug 15, 2015
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CONTENTS
INTRODUCTION | A Journey of Discovery .......................................................................................... 3
INSIGHT 1 | Assess the impact on marketing management of new technologies ............................. 4
INSIGHT 2 | Assess how a strategic marketing planning approach can assist in identifying
opportunities for a business. .............................................................................................................. 6
INSIGHT 3 | Application of key marketing tools and frameworks to business issues. ....................... 8
INSIGHT 4 | The importance of developing a marketing culture that embraces innovation ........... 10
REFERNECES ...................................................................................................................................... 12
3
INTRODUCTION | A Journey of Discovery
As an emerging leader at International Business Machines (NYSE: IBM), my career path to date has
been one that has provided me with many insights into the marketing profession and the value that
it delivers to our business. My participation in SMBA6006 Innovation in Strategic Marketing,
however, has served to galvanise in my mind the criticality for business leaders to ensure that
marketing is central to the organisation’s end-to-end operations and introduced to me a range of
innovative and emerging practices that have strengthened my capabilities.
This reflective essay seeks to; (i) Highlight the most important learning points I take away from the
unit; (ii) Articulate how these insights impact my approach & understanding of business issues as
they relate to my current organisation, and finally; (iii) Document specific actions that I will take to
apply my new marketing knowledge to deliver greater value to my organisation and key
stakeholders.
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INSIGHT 1 | Assess the impact on marketing management of new technologies
I arrived at SMBA6006 shortly after attending the 2014 ADMA Global Forum. As Australia's
preeminent event for marketing professionals, I left the event with a newfound appreciation -
bordering on complete wonder - of the capabilities of new technologies on marketing management.
Keynote speakers such as Andy McKeon (Global
Customer Marketing Lead at Facebook) and Scott
Brinker (founder of Chiefmartec.com and Harvard
Business Review contributor) provided amazing insights
as to how their organisations were employing
technology. They spoke of tailored client journeys,
signature brand experiences and personalized
interactions that, only a few years ago, were the
preserve of Hollywood blockbusters such as Minority
Report.
Engaging with the various case studies in this course, however, helped me to more fully appreciate
the pervasiveness and speed at which new technologies are emerging. From bricks-and-motor
retailers such as Nordstrom who are using sensors to monitor customer’s in-store behaviours (i.e. so
as to inform their approach to marketing); to online retailers such as Amazon who are piloting the
use of drones (i.e as a channel for order fulfilment); to inside the consumer’s home, such as is the
example of Nest who have developed an automated thermostat (that captures & monetizes data on
customer’s behaviour) it is clear that we now live in an age of disruptive technology. These dynamic
is transforming the way that we live, work and the options available to marketers to reach & engage
with consumers.
As these new capabilities evolve, so too do the skills, capabilities and understandings required of
today’s marketing professional. This view is supported by Brinker who asserts; “marketing is rapidly
becoming one of the most technology dependent functions in business” (Brinker & McLellan 2014).
Marketers can’t rely upon established methods, approaches or their current knowledge-base but
must be proactive in adopting a real interest in technology if they are to ensure that the impact of
these emerging technologies on their organisation’s competitive advantage are anticipated,
understood and effectively addressed/leveraged.
Despite the absolutely incredible capabilities of these new technologies, Professors Frow & Briley
helped me to appreciate that a distinct interplay between the digital/online world and the physical
world in which your customers are located remains in-place. With reference to the online retailers of
Bonobos, Diapers.com and Warber Parker, MIT Sloan Management Review’s research entitled; What
Matters Most in Internet Retailing (2012) helped me to more fully understand this dynamic. The five
(5) key findings of this research, specifically that; (i) Individual consumer acceptance depends on
offline shopping costs; (ii) Sales evolution is structured and predictable; (iii) Migrating from “good”
to “great” requires expansion to niche locations; (iv) “Isolated” prospects are worth pursuing and
finally; (v) Different locations require different customer acquisition strategies (Bell et al. 2012) have
helped me to understand how marketers can leverage their knowledge of their customer’s offline
circumstances to deliver improved business outcomes with technology.
Figure 1 | Facebook's Andy McKeon speaking at the 2014 ADMA Global Forum
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Beyond maintaining my passion for technologies and being committed to understanding my
customers’ offline circumstances I see two further actions that I can take as an MBA candidate to
positively impact management practice. Both actions relate to my position as a marketing
management professional at IBM. Firstly, I hold the privileged position of studying alongside both
other marketing professionals (e.g. Aaron, Darren) and IT professionals (e.g. Bruno, Ross, Phon)
within the Sydney University MBA Cohort. As Brinker asserts, closer collaboration across these two
functions is absolutely critically in ensuring ongoing business success in a period of disruptive
technology (Brinker & McLellan 2014). Given that I am committed to the ongoing success of
Australian enterprise, my classmates & I, in committing ourselves to understanding the priorities,
challenges and opportunities of or respective professions can act as the catalyst for greater inter-
departmental collaboration within our own organisations. Secondly, my position as a marketer at
IBM given that; (i) influential industry analysis such as Gartner predict that by 2017 the CMO will
spend more on IT than the CIO (McLellan 2014) and; (ii) IBM is rapidly developing its portfolio in
marketing technology, presents me with the opportunity to lead my organisation’s engagement of
other marketing professionals who would be likely to see business value in our solutions.
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INSIGHT 2 | Assess how a strategic marketing planning approach can assist in identifying opportunities for a business.
For the past four years at IBM, I have worked within their Sales & Distribution organisation. More
specifically, the IBM Inside Sales division whose mission is to provide efficient and effective client
coverage of small to medium sized businesses (SMBs) throughout Australia & New Zealand. To these
ends, I found tremendous value in learning more about marketing best practice in relation to
segmentation. IBM’s approach to segmentation, as outlined by IBM’s global leader of Sales &
Distribution Bruno Di Leo (2014), is outlined within the figure below;
In purely simplistic terms, the factors considered when applying this segmentation model to the
entire population of accounts which we serve are; (i) How much did the client spend with us in the
previous year? (ii) What do we forecast they will spend on IT (i.e. IT wallet) in the current / year
ahead? And finally; (iii) How likely it is that we can increase our share-of-wallet within the current /
year ahead? In making some informal enquires around the office, I’m led to believe that this
methodology has been in-place for many years. The segmentation applied drives the choice of
channel, ranging from; call-centre for midmarket clients through to; small teams servicing 10-50
accounts in the Enterprise segment all the way to; large teams servicing one client, often at the
client’s own offices.
My participation in SMBA6006, however, has raised many questions as to the efficacy of this
approach. Professor Frow and Jetstar’s Rob Deming instilled in me an appreciation of the criticality
of channel strategy and, more importantly that choosing the correct channel for the right product at
the right time is of paramount importance. This is particularly relevant to my organisation given the
breadth of our portfolio and the fact that developments in cloud computing are making enterprise IT
increasingly affordable and accessible.
The current approach to segmentation, as described previously, does not take into account that a
large “industry account” would often feel comfortable in procuring a simple technology (e.g.
Industry
•For the Industry segment, IBM invest in customized coverage for key clients to increase client intimacy and build enduring relationships through cross-brand teams dedicated to their needs. IBM accelerate growth within the client by bringing deep industry expertise and client growth strategies to unlock new opportunities across the C-suite, including line of business buyers and the CIO. One client, one team.
Enterprise
• In the Enterprise segment, IBM dedicate integrated IBM S&D and Brand teams to a local market, bringing IBM solutions, talent and specialized industry skills closer to a broader set of clients. We will develop relationships and new sources of growth with line of business buyers, win-back opportunities and new clients. One territory, one team.
Midmarket
•The Midmarket segment is unchanged and IBM continue to cover medium-sized enterprises with less than 1,000 employees, with the focus on transactional sales led by Business Partners.
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additional software licence) rapidly via self-service without the need to engage an IBM or that a
small “midmarket” client, seeking a more sophisticated solution (e.g. IBM consulting engagement)
may require a formal solution overview from an IBM consulting partner. Under the current
segmentation framework that is based solely on the customer’s size & IT Wallet with little/no
consideration of the solutions that they are seeking, client frustration could often ensue.
Furthermore, increased channel costs, and ultimately, a failure to capture latent demand for our
products/services, are increasingly likely.
In reflecting further on my learnings in this regard, and critically how they issue identified could be
addressed, I return to the concept of ACURA. The Acquire, Cross-Sell, Up-Sell, Retain, Advocacy
framework was introduced to me for
the first time in this unit, yet I can
immediately see the benefit that its
application would lend to my business.
Defined as; “the formal processes for
maximising value creation - both for a
company and for a customer” the
model is an entirely foreign way of
thinking in respect to my
organisation’s current approach (Frow,
2014).
Two key advantages, include the fact
that the model prompts one to think in
terms of the segments which
represent the greatest long-term profit
potential, as opposed to the greatest
profit potential in the current quarter/year. Returning to the impact of technology on marketing
practice, and the fact that these very technologies are disrupting established industries, serving to
replace established players with their newer competitors (e.g. Blockbuster vs Netflix), adopting this
perspective so as to ensure that our company establish an early footprint in these organisations is
absolutely critical. Furthermore, in identifying what is the best ACURA strategy for each segment an
admittedly more complex, yet dynamic and responsive, approach to delivering clients with the most
appropriate offerings, at the right time and via the right channel could be achieved. This
conversation is one that I will take up with my businesses’ leadership.
Acquire
Cross-Sell
Up-Sell
Retain
Advocay
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INSIGHT 3 | Application of key marketing tools and frameworks to business issues.
A key insight that emerged as a consequence of my participation in SMBA6006 is that marketing,
when permitted to fulfil its complete scope, touches almost every aspect of the business. To the
uninitiated, marketing is quite often seen as the “creative type”, developing the latest tag line or the
next viral advertisement. Whilst these duties fall to the marketing department, true best practice
occurs when these tasks take place within a broader ecosystem of planning, analysis and intentional
execution in the pursuit of specifically defined outcomes of value to both the organisation, and
critically, their customers.
In a week where IBM have; (i) announced their 10th consecutive quarter of declining revenues; (ii)
have abandoned their 5 year strategic plan as it is no longer achievable; (iii) have seen their stock
price drop 11% in a week and; (iii) now hold the grim
reality of being the stock in the Dow Jones Industrial
Average that has lost the most support from Wall
Street analysts - hinting to further decline, I’ve been
reflecting on whether my own company appreciate
the importance of placing marketing at the centre of
their operations. Unfortunately, there is a growing
body among the commentariat who believe that this
may not have been the case for some years (Denning
2014).
Delving deeper into the commentary, in particular, to
our CEO & chairman’s own analysis, these revenue
results reflect the fact that our legacy business lines
(e.g. hardware) is being disrupted by the emergence
of new technologies (e.g. cloud computing), and
critically, changing customer preferences (i.e.
procuring solutions as-a-service and paying for what
they use daily as opposed to multi-year contracts paid
for up-front) faster than we’ve been able to transform
ourselves (Rometty as cited by Waters, 2014). Harvard
Business review assert; “marketing, as the primary link between the enterprise and the external
world of competitors and potential customers, are often in the best possible position to understand
what customers need and value” (HBR, 2006). Given the situation my organisation finds itself in
today, late to transform to meet customer’s preferences and seen as an enterprise who value
investors more so than their customers, it is difficult to fully believe that marketing have the
influence into the organisation’s strategy that perhaps they truly should. As an emerging business
leader, I must champion for the role of marketing in actively contributing to our organisation’s
strategy so as to ensure that we address these concerns, and through doing so, deliver to our
customer’s expectations.
In the context of IBM, given the commentary above, a marketing tool/framework in which I perceive
significant immediate utility is the Boston / ‘growth – share’ matrix. Once again, this was a
framework that was introduced to me for the first time within SMBA6006. Given the breadth of
Figure 2 | IBM’s, Ginni Rometty (CEO and Chariman) as depicted by Forbes
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IBM’s solution portfolio, this tool is incredibly useful as a means of analysing our different business
units and allocating resources effectively. At a high level, I can see that our legacy hardware
businesses are our “dogs”, our analytics and cloud computing capabilities our “stars”, our services
division our “cash cow” and our artificial intelligence Watson capability as being our “question
mark”. That I can observe this allocation being mirrored by our organisation’s divestment,
acquisition and investment strategies, (e.g. The 2004 sale of IBM’s PC division to Lenovo; the 2013
sale of the x86 server business to Lenovo, the 2013 acquisition of cloud-computing start-up
SoftLayer; the March 2014 announcement that IBM would create an entirely new “Watson Division”
and finally; the October 2014 sale of our semiconductor plant to Globalfoundries) is a powerful
reminder of how marketing, when permitted to fulfil its complete scope, play a pivotal function in
guiding the business’ overall strategy. Armed with these new insights as to the importance of
positioning marketing centrally within the organisation’s overarching strategy, I conclude SMBA6006
renewed in my motivation to champion for the role that marketing must play in ensuring the future
success of the organisation.
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INSIGHT 4 | The importance of developing a marketing culture that embraces innovation
One of the new insights I gained from my participation in SMBA6006 was that of co-creation. I found
the whole concept a true step-change from what I have become accustomed to at work, given that
for the past 5 years, the entire organisation have been mobilised in the pursuit of a strategy
designed around one guiding principle, namely; shareholder value. In working closely with my group
(i.e. Willis, Alex, Chris & Ben) as we explored how Air New Zealand had been employing, and stood
to gain from proposed, co-creation strategies I came to realise that a marketing culture that
embraces innovation is one that can deliver tremendous value to the organisation.
Re-envisaging the process of value creation from one that emphasis the value delivered by the
enterprise alone, to a richer perspective that appreciates that all stakeholders (i.e. customers,
employees, suppliers alike) can jointly collaborate to develop value has been tremendously
impactful. I depart the course complete in the belief that this approach to value creation will be a
hallmark of successful businesses within the years ahead.
As an MBA candidate, I’ve come to appreciate that employee morale and engagement is a critical
predicator of an organisation’s profitability. My experience in SMBA6006 has instilled in me a belief
that co-creation can be an extremely effective strategy in helping to improve employee engagement
and that the need for marketers to unlock the latent potential of the organisation’s workforce in the
pursuit of their, and the organisation’s objectives, is absolutely critical. This view is supported by
Aarons & Driest (2014) who assert: “Marketing has become too important to be left just to the
marketers. All employees, from store clerks to IT specialists, must be engaged in it”. This
understanding will guide me in seeking out the input, participation and involvement of a broader
selection of my colleagues when defining, testing and analysing my strategies.
Returning to my own organisation, many commentators cite organisational challenges which could
impact upon our ability to quickly implement co-creation strategies. Cringley (2014), for instance
asserts that;
IBM’s workforce is operating in survival mode. They have no voice, no means to make IBM
better, and they are certainly not going to stick their necks out. IBM is squandering its
greatest resource and most of its best minds.
That these points resonate with me at a time when our business face challenges, I am once again
reminded of the inseparable position that marketing plays within the organisation and the role that
a marketing culture that embraces innovation can play in delivering valued business outcomes. My
thinking is such that I can envisage a step-change from our leaderships’ current approach that has
propagated a hesitance among the ranks to engage with and propose bold ideas, to a new
framework, based on co-creation principles, that unlocks the latent capacity of the staff to instigate
new initiatives to address the challenges we face. Not only could this deliver greater value to the
business and our clients, the staff would invariably feel more engaged, motivated and committed to
our organisation’s success. That a marketing culture that embraces innovation could address human-
resource (HR) considerations such as employee morale and engagement, serves to reinforce the
importance of placing marketing at the centre of the organisation’s operations.
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Fortunately, while things may be grim on the employee-front, there are signs that my organisation is
shifting to this new mindset when it comes to our customers. For instance; (i) IBM has recently
released a development platform called Bluemix that allows developers to build their own
applications on the IBM Cloud Platform and provides a commercial outlet for Bluemix developers
(clients & IBMers) to sell their wares under the IBM brand umbrella and; (ii) Developed Watson
technology and commercialized it as a cloud platform with IBM and outside parties building a variety
of applications on top of it (Miller, 2014). These are exciting developments for my business, and
armed with the new insights I take away from SMBA6006, most notably, the conviction I hold as to
the importance of a marketing culture that embraces innovation, will guide my career trajectory.
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REFERNECES
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